PC, PLLC, or MSO? Untangling the Entity Alphabet Soup for a New Med Spa

New owners come to us with a version of the same question: “Do I need an LLC or a PC?” The honest answer is usually both — along with a services agreement connecting them — because a med spa in a CPOM state typically isn’t one business. It’s two, working together under a contract.

The Professional Entity

This is the entity that actually delivers care — a Professional Corporation (PC), Professional Medical Corporation, or in some states a Professional Limited Liability Company (PLLC), owned by a licensed physician. It holds the clinical relationships: the providers, the patient records, the treatment protocols. In a CPOM state, this entity cannot be owned by a non-physician, no matter how much of the business plan, funding, or brand identity came from someone else.

The Management Company

This is typically a standard LLC or corporation, owned by whoever is actually running the business side — the founder, the investors, the operator. It handles everything non-clinical: marketing, real estate, staffing support, systems, brand, growth strategy. It earns a management fee from the professional entity for these services, set at fair market value, not structured as a share of clinical revenue.

The management company runs the business. The professional entity practices medicine. The moment those two roles blur together, so does your liability protection.

Why the Split Matters More Than the Label

Owners sometimes fixate on which specific entity type to form, when the more important question is whether the relationship between the two entities is documented correctly. A well-drafted Management Services Agreement (MSA) is what actually defines who does what, what the fee structure is, and how decision-making authority is divided. Get the entities right but skip a real MSA, and you’ve built the shell without the substance.

A Simple Way to Think About It

• If it requires a medical license to do, it belongs to the professional entity
• If it’s a business function — marketing, HR, facilities, finance — it belongs to the management company
• Money moves between them through a documented management fee, not an informal transfer
• Both entities need their own governing documents, and the MSA needs to actually reflect how the practice runs day to day

Every state has its own nuances on entity naming and formation requirements, and not every state applies CPOM the same way — so this isn’t a one-size-fits-all template. But the underlying logic — clinical control stays with the physician, business control stays with the operator, and a contract connects them — holds across almost every structure we build.

If you’re early in planning and trying to figure out what your specific state requires, that’s exactly where we start every engagement.